130 P. 66 | Utah | 1913
The Culmer Paint & Glass Company commenced this action against John T. Gleason and Adell Gleason, as owners of certain real estate, which is described, and against one O. M. Engdahl, as contractor, to foreclose a mechanic’s lien. The appellant, P. W. Gorman, and the Salt Lake Security & Trust Company, hereinafter called trust company, were also made parties; the former claiming a mechanic’s lien, and the latter claiming a lien as mortgagee, upon the real estate aforesaid'. There were also other parties to the action; but all of those, as well as the Culmer Paint & Glass Company and the Gleasons, have either been dismissed from or have abandoned the case. Both Mr. Gorman and the trust company filed cross-complaints, in which they set up their respective liens; and the whole controversy on this appeal is between those two claimants.
As conclusions of law, the court found that Gorman was entitled to a lien for the amounts found due him, as aforesaid, on the building and real estate; that the trust company also was entitled to a lien for the amount of its mortgages, to wit, $12,390; and that said mortgage liens were prior and superior to Mr. Gorman’s lien.
A judgment or decree of foreclosure of appellant’s lien Mras entered in accordance with said findings and conclusions of law. Mr. Gorman alone appeals. He assails both the findings of fact and conclusions of law.
“Exhibit G is a transcript of our ledger account of O. M. Engdahl. Exhibit F is a true and correct transcript of the Gleason account. In the fourth line the entry of A. H. Birrell, $590, is one of the disbursements on account of the purchase price of this bond and mortgage. My understanding is that the next item is for. the services of Mr. Cahoon. The item of $2210 is the difference between the price at which we purchased these bonds and mortgages and their face. I would like to say that $250 should come out of that, making a net amount of $1960; That item is the difference between what we paid for the bond and its face. We purchased these bonds and mortgages at eighty-four per cent.*348 of tbeir face, and this represents tbe difference between that eighty-four per cent, and the face value. • We purchased from Mr. Birrell.”
Eighty-four per cent, of $12,390 amounts to the sum of $10,407.60. The president’s testimony, to our minds, is corroborated by the amounts that the trust company claims were actually paid out for the construction of the building. The amount paid to Contractor Engdahl, as shown by the vouchers, is $9263.70, or $13.70 more than the contract price; and the amount paid to the architect is $706.10. These two items amount to $996.80, or $437.80 less than the eightv-four per cent, advanced on the mortgages. There is evidence to the effect, however, that out of the $437.80 there were various sums paid for other purposes, so that it is probable that the trust company did in fact advance upon the mortgages the full eighty-four per cent, of the $12,390, the face value thereof. While the evidence is not as clear upon the latter point as it might be, yet we think the evidence clearly supports a finding that the eightv-four per cent, was in fact advanced for the benefit of the Gleasons. There is therefore a discrepancy between the amount stated in the mortgages and the amount advanced on them, amounting to $1982.40. The president of the trust company, in his testimony, admitted this discrepancy to be $1960. He, however, claims that various amounts were paid out as commissions. Eor example, there is one item of $2210, of which the president claims the $1960 is a part, which he said was paid as a commission to Mr. Birrell. Mr. Gleason, however, testified that he knew nothing about commissions, “except the architect’s fee.” Again, it is not easy to perceive how the trust company could pay a commission of either $2210 or $1960 out of $437.80, the amount remaining of the eighty-four per cent., after the contractor and the architect were paid. There is therefore nothing upon which the trust company can base its claim for the $1982.40, except we say, as the district court found, that the contract price for the construction of the building was $12,390. Such a finding, however, cannot be sustained, for the reason that the con
In view of the whole record, we can arrive at no other conclusion than this:
That when the Gleasons had expressed a- desire to erect a building on the real estate the matter was by some one (no matter by whom) submitted to the trust company; that the company agreed to advance sufficient money to construct the building, not to exceed the sum of $1-2,890; that two mort
Counsel for Mr. Gorman vigorously contend that the claim ■of the trust company is usurious under our statute. After ■carefully considering all of the facts, and circumstances, we, however, entertain a serious doubt with respect to the usury elaim. Our statute (Comp. Laws 1907, sec. 1241x3) provides as follows:
4 “All bonds, bills, notes, assurances, conveyances, mortgages, deeds of trust, all other contracts or securities whatsoever, and all deposits of goods or other things, whatsoever, whereupon or whereby there shall be reserved or taken or secured, or agreed to be reserved or taken, any greater sum or greater value for the loan or forbearance of any money, goods, or other things in action than is above prescribed, shall be void; but this title shall not affect such contracts as have been made previous to the time it shall take effect.”
Section 1241x8, in substance, provides that whenever it satisfactorily appears by the admission of the party, or by proof, that any bond, bill, note, assurance, pledge, conveyance, mortgage, deed' of trust, contract, security, etc., is usurious, the court must declare the same void and order it delivered up> and canceled, and enjoin any prosecution thereon. This is a most drastic statute, since it forfeits the creditor’s entire claim. The statute authorizes more than confiscation for public use. It, in effect, permits it for private use, since the debtor seems to be entirely relieved from his obligation to pay, in case usury is established. Courts always abhor forfeitures, and this is especially true of courts of equity. Forfeitures, therefore, especially such
In view of the foregoing conclusions, we need not consider or pass upon the contention made by counsel for the trust company that Mr. Gorman, as a junior incumbrancer, is not in a position to raise the question of usury. Upon that point we express no opinion.
From what has been said, it follows that the findings of fact and conclusion of law, so far as they affect Mr. Gorman, and to the extent that they are in conflict with what we have said, must be vacated and set aside; that the judgment, so far as it affects Mr. Gorman, must be reversed and the cause remanded to the district court, with directions to vacate its findings with respect to the amount found- due on the two mortgages of the trust company, and to substitute therefor a finding that there is due on said mortgages, as against Mr. Gorman, the sum of $10,407.60, with interest as stated in the findings; to mate conclusions of law that, subject to said sum of $10,407.60, Gorman has a lien on the mortgaged premises for the sum stated in the court’s findings; to enter a decree of foreclosure ordering a sale of the mortgaged property and a distribution of the proceeds of the sale as follows: $10,407.60, with accrued interest, to the trust-company; $900, with costs, attorney’s fee, and interest, to Gorman; and the balance, if any, to the owner of the property. Except as modified above, the findings of fact, conclusions of law, and judgment are affirmed. Appellant to recover costs.